In the world of health care, it is nearly impossible for a patient to know what a given health care service or procedure will cost. This is due to the complex financial and contractual relationships between patients, providers, insurers, and employers. With no visibility into how the pricing works, patients are unable to budget spending, or comparison shop for better prices.
The out of pocket cost a patient is responsible for is based on a number of factors, including: a) the provider's negotiated rate with the patient's insurance company, b) the context in which the procedure occurred (location, other services rendered, etc), and c) attributes of the patient's health plan. The attributes can include the patient's plan provisions, individual and family accumulators such as deductible status, out-of-pocket maximums, and past services used by the patient and family.
When health care providers contract with insurance companies, they agree on a negotiated rate schedule for the procedures the provider offers. These negotiated rates are particularly difficult to determine. These are largely considered confidential, and providers are unwilling to publish them, despite the fact that they have a significant impact on the patient's cost. Since many insurance plans require patients to pay the full negotiated rate before the patient's deductible is met, the negotiated rates are elemental in determining the patient's cost.
Additionally, medical billing revolves around several different procedure coding systems—CPTs, HCPCs, revenue codes, and the like. These arcane coding systems are of minimal relevance to patients, due to their cryptic numeric systems and technical jargon. For a system to help patients understand the costs of medical care, it would need to bridge the gap between the industry's status quo billing procedures, and a patient-oriented view of the medical world.
It is desirable to have a method and/or system for predicting provider negotiated rates which can be used to provide a patient with estimates of how much the patient can expect to pay out-of-pocket for medical services, including medical procedures, medical provider encounters, hospital visits, prescription drugs, and durable medical equipment.